Sdx Energy Share Discussion Threads

[hiddendepths] 06/7/2017 09:33

I don't think there's much doubt that the shares are undervalued based on the assets and potential. I also don't think that there's much doubt that there have been sellers on the basis of disappointment of the SD figures. That stock has to be absorbed by the market so the shares fall to a level where those who think the value is high enough to justify buying more than makes up for the RNS. That is just the mechanics of the market.

I tried to buy back at a bit lower than the 47p quoted and found, as royaloak observed, that the stock wasn't there. I'll continue to watch for now. If I've missed the low, sobeit, I've still got a decent slug.

[royaloak] 06/7/2017 09:33

hidden depths

Agree, MM's are smart cookies, that is what we are up against, yesterday they could see which way the wind was blowing and were happy to sell knowing they could pick up cheaper at sometime. Am guessing that they are now buyers to fill the shares they were short of from yesterday.

Before I buy or sell I always try and get a feel for the real market before I commit myself, especially on smaller company shares, with larger companies it is much more difficult to gauge what is going on.

[hiddendepths] 06/7/2017 09:06

Standard ploy, royaloak. They're trying to shake out loose holders and trigger stops. I guess the MMs saw which way the wind was blowing and went short themselves and are now trying to get filled on the cheap.

Possibly anyway!

[neo26] 06/7/2017 09:04

Wth this fall isn't warranted..

[royaloak] 06/7/2017 08:59

Be careful about MM quotes again, yesterday they were not willing to pay Bid price, the situation has now reversed:

Quote 46 / 47

actual

46.7 / 47.48

[tournesol] 06/7/2017 08:59

Pauliewonder

The thing to remember is that you are not investing in the company, you are investing in the shares of the company. A quite different thing. (the shares are effectively a derivative rather than the primary underlying entity)

It is entirely possible for companies to go from strength to strength whilst their share price goes into retreat. That is not irrational, it's because the share price is a crowd sourced attempt to predict the future of both the co and the market and the wider economy. The crowd in question is subject to mood swings and miscalculations so share prices tend to overshoot and undershoot fair value. Over the long term the oscillations tend to converge. Over the short term they can go all over the place.

It should be the aim of an independent investor to buy on the undershoot and sell on the overshoot.

In the case of SDX the announcement yesterday represented an under delivery by comparison with the expectations raised previously by the company's communications which now seem to have been somewhat over-optimistic. With the share price having done well over the past year, a disappointment is only going to shepherd the share price in one direction.

And today people will ask themselves "has an over-optimistic mind set led to other past statements by the co being too strong? Will Morocco be as easy a success as we have been led to expect? Will production in Egypt be so easy to ramp up?". And these doubts will reinforce the downwards oscillation.

I still like the underlying co and the management. I just think the investment case has been over stated and the share price has got ahead of itself. When things get back into synch I expect to be back.

Good luck if you decide to practice LTBH and ignore short term fluctuations.

[deltrotter] 06/7/2017 08:57

Totally agree cash - it does become a self fulfilling prophecy.

[pauliewonder] 06/7/2017 08:56

Going to be a bid at these prices. Money talks and this is a cash generative business, very lucrative, going very cheaply.

[cashandcard] 06/7/2017 08:54

I think its become a self-fulfilling prophecy of sorts, folk closing out and publicizing it on here as to why. It will inevitably lead to poor sentiment and price weakness. Smaller companies are, in part, driven sentiment, not just fundamentals.

If we do go lower, I will add as I find the value proposition much better now than low 40's prior to drilling South Disouq. Some will trade this, or hold a position short-term. I tend to hold and add/average-down longerterm if they have an active portfolio on the go, SDX fit that bill. There may even be surprise or two along the way.

Each to their own, I hope everyone does well.


Cash

[plentymorefish] 06/7/2017 08:52

More to it than the update?

[muffster] 06/7/2017 08:50

Numbers obviously not liked by the market, big drop again.

[deanroberthunt] 06/7/2017 08:48

I canna hold her much longer captain!

[deanroberthunt] 06/7/2017 08:45

timbeeeeeer

[captain james t kirk] 06/7/2017 08:33

tournesol
I've learnt that it's much less painful to miss out on a short term gain, than it is a short term loss.
And the losses normally work out to be much larger than the gains.

[brasso3] 06/7/2017 08:32

Just picked up 10k

[tournesol] 06/7/2017 08:23

Lauders

Thank you. I don't post to knock the co or its shares, but simply to contribute to the wisdom of crowds by sharing openly what I think and what I am doing.

I rarely try to predict short term movements in share prices and when I do I usually get it wrong. So I usually stick to a LTBH mindset.

But I have learned the hard way that LTBH is often not the optimum approach. So on those occasions when my antennae do pick up warning signs I prefer to act on them or at least consider acting rather than just crossing my fingers.

This year that approach has got me out of AEX at 6.5p and HUR at 50 something. In both cases I posted my thoughts about these specific companies.

I then sold out of almost everything else before the election in case Labour won. That was a third good call. Yesterday's was my fourth of the year. If I keep this up I might be on to something. Which might make up for years of ignoring short term concerns and seeing myself go backwards as a result.

[milliecusto] 06/7/2017 08:20

Nice 120k buy

[soulsauce] 06/7/2017 08:11

Wonder if Highclere will be picking more up in the current sale?

[muffster] 06/7/2017 08:05

Down again, is the Nav here circa 47p?

[lauders] 06/7/2017 08:03

tournesol - Good analogy below:

Imagine you are skiing and you suddenly find yourself in circumstances where you think an avalanche might occur. Maybe the snow is weird or you hear a distant noise or you see an unexpected movement or you see someone in the distance doing something unusual as if they are trying to escape. Or even someone close by shouts "avalanche".

Do you
a) ignore it to show your constancy and strength
b) stand still
c) find a safe place out of the route of any possible avalanche

Most of the time there is not going to be an avalanche, so you'll get away with a or b. But sometimes you won't.

Whereas there is no downside at all to c).

The factor that is critical in your story though is the "eye-sight" or awareness of the person involved (me in your story). Now I am first to admit that I know very little about the O&G sector so my awareness is not as acute as perhaps yours is and thus investors like myself might not see the dangers as quickly as you or other experienced skiers might. I am hoping that your c) does not come into play of course but I am certainly more aware now, so thank you.

[pauliewonder] 06/7/2017 07:45

Agree. It was a good solid update in which the market has for some reason reacted badly to. The update proves that it is commercial quantities and de-risks the whole area. Not sure what the issue is here other than the share price dropped, its still a great company with great assets.

If people want to get in cheaper then be my guest, but you may also be getting in higher depends on how the markets react, which I know from investing a while can be difficult to predict

[milliecusto] 06/7/2017 07:39

Cash positive,no debt and increasing income moving forward....to much doom merchants on here

[haideralifool] 06/7/2017 07:32

The next set of financials should be out next month?

[orinocor] 06/7/2017 07:32

I warned against this company a few months ago. In particular it did not make sense they picked us these apparently super assets so cheaply. The shares doubled in quick order based on an acquisition, the price of which did not make which did not make sense. Everyone just assumed, even in a competitive market, SDX stole these assets. It did not help when the likes of Tournesol was claiming this was the best opportunity since Soco. It's strange how even experienced O&G investors take prospective oil, or gas in place estimates at face value.

[deltrotter] 06/7/2017 06:53

Yup. Also worth remembering they have something like £25m cash including receivables....

Those production levels will increase massively in the medium term.